Paramount Equity: bankruptcy applications on a $16.2 million judgment

In 2018, companies owned or controlled by Enzo Mizzi claimed approximately $105.5 million from the two Paramount mortgage funds. The borrowers among them said Silverfern Secured Mortgage Fund and GTA Private Capital Income Fund had failed to advance the full amounts set out in their loan agreements, and sought lost profits and damages on that footing; Virk Hospitality Corp., on its own, put its claim at $75,801,573.35. Justice Hainey disallowed all of it, per the Endorsement of Justice Hainey (2018 ONSC 5327), Sept. 18, 2018, paras. 2–3, 59–60 and Sched. "A".

Virk Hospitality is now bankrupt, along with four of the other borrowers, and their trustee is Grant Thornton Limited, the firm appointed receiver of the Paramount Group in 2017 on the application of the Ontario Securities Commission. On August 26, 2026, the Registrar in Bankruptcy issued that trustee's applications for bankruptcy orders against Enzo Mizzi and his brother, Filippo Mizzi. Each claims $16,700,952.50: $16,200,952.50 under a Commercial List judgment of April 27, 2026, owed jointly and severally with their sister, Mary Campisi, and $500,000 under a costs order of May 25, 2026. Each alleges a single act of bankruptcy, that the debtor "has ceased to meet his liabilities generally as they become due," and names A. Farber & Partners Inc. as the trustee to take his property, per the Application for Bankruptcy Order (Filippo Mizzi), Aug. 25, 2026, paras. 2–6 and the Application for Bankruptcy Order (Enzo Mizzi), issued Aug. 26, 2026, paras. 2–6.

Two applications on one judgment

Grant Thornton applies as trustee in bankruptcy of 2398035 Ontario Inc., 2488123 Ontario Inc., 2538139 Ontario Limited, 2540594 Ontario Limited and Virk Hospitality Corp., which the verification affidavits call the Mizzi Borrowers, the capacity in which it won the April judgment. Jason Kanji, a vice-president of the firm, affirmed both affidavits on August 25. They say Grant Thornton became trustee of four of the borrowers on May 25, 2020 and of 2540594 Ontario Limited on December 7, 2021; that the trustee holds no security; that its lawyers demanded payment on June 4, 2026 and nothing has been paid; and that "Neither Filippo nor Enzo have appealed the Judgment or the Costs Order," per the Affidavit of Verification of Jason Kanji, Aug. 25, 2026, paras. 1, 5, 10–13.

The demand letter from the trustee's lawyers, Chaitons LLP, gave fourteen days to pay the judgment with interest and the costs, and added: "As a result of the appeal commenced by Mary Campisi, enforcement steps against her are stayed at this time." Ms. Campisi's notice of appeal is dated May 11, and on August 4, 2026, according to the affidavits, she filed a notice of intention to make a proposal under the Bankruptcy and Insolvency Act, per the Application for Bankruptcy Order (Filippo Mizzi), Aug. 25, 2026, Kanji Affidavit para. 9 and Ex. "C", pp. 1–2.

On other creditors the affidavits differ: Filippo Mizzi's names none besides the trustee, while Enzo Mizzi's reports an execution search generated August 5, 2026 that shows two older judgments against him: $19,569.78 owed to Van Smit Ltd., operating as Jay Dee Concrete Forming, under a judgment of May 17, 2011 bearing interest at 24%, and $1,275,761.35 plus $3,500 in costs owed to Canadian General Insurance Company under a judgment of August 17, 1998 bearing interest at 6%, per the Affidavit of Verification of Jason Kanji (Enzo Mizzi), Aug. 25, 2026, para. 14. The notice of hearing issued with each application leaves the day, month and hour blank.

Investor money, five project sites

Justice Myers, deciding the transfer case in April, noted "a much bigger story about how Paramount Group came to make these loans," and set it aside as not germane, per the Endorsement of Justice F.L. Myers (2026 ONSC 2470), Apr. 27, 2026, para. 33. The Ontario Securities Commission's notice of application of May 25, 2017, brought under s. 129 of the Securities Act, said the group had sold approximately $78 million of units in two pooled mortgage funds to over 500 investors, and that investors told the funds would hold "second residential mortgages" had instead seen approximately 70% of their money, about $50 million, placed in land and multi-residential development projects, per the OSC Notice of Application, May 25, 2017, paras. 2(a), 2(c), 2(g)(i), 2(q)–(s). Those were the Commission's allegations; the record read for this piece contains no Commission decision on them. Justice Hainey appointed Grant Thornton interim receiver on consent on June 7, 2017, and on August 2 Justice Penny made the receivership full, on consent as well, per the Unofficial Transcribed Endorsement of Justice Penny, Aug. 2, 2017, p. 1 and the Endorsement of Justice Hainey, June 7, 2017.

By Mr. Kanji's account the group raised approximately $115 million from investors and advanced approximately $45 million of it to the five borrowers, "all of whom were owned and controlled by" the three siblings, as loans secured by mortgages on the borrowers' land, per the Affidavit of Verification of Jason Kanji (Enzo Mizzi), Aug. 25, 2026, para. 3. Each owned a different project site; Justice Myers called them "single-purpose entities." The trustee's factum lists the sites: 1677 Wilson Avenue in Toronto, which included the Toronto Plaza Hotel and adjacent vacant land; an 88-suite retirement residence on Harriet Street in Penetanguishene; a vacant, partially renovated retirement home at 24 Simcoe Street in Orillia; 69 Ainslie Street South in Cambridge; and 326 Dacey Road in Sault Ste. Marie. The Wilson borrower alone received loans of $21,566,463.09 between February 26 and September 9, 2016, the factum says, per the Factum of Grant Thornton Limited, Apr. 2026, paras. 20, 22, 28, 36, 43, 49 and the Endorsement of Justice F.L. Myers, Apr. 27, 2026, para. 21.

In 2018 Grant Thornton was also appointed receiver of four of the borrowers, the factum says, and the Harriet Street property was sold under power of sale by its vendor-take-back mortgagee in December 2017, per the Factum of Grant Thornton Limited, Apr. 2026, paras. 23, 34, 38, 45, 51. Justice Hainey's order of April 23, 2020 authorized the receiver to file assignments in bankruptcy for 2488123 Ontario Limited and 2398035 Ontario Inc. and to nominate Grant Thornton as trustee, per the Order of Justice Hainey (Authorization to Bankrupt), Apr. 23, 2020, paras. 1–2. On the lending side, the receiver settled its claim against Garfinkle Biderman LLP, counsel on the loans, for an amount it must keep confidential, per the Notice to Investors of Litigation Settlement and Claims Bar Date, Dec. 8, 2023, p. 2. On August 16, 2024, Justice Conway granted it default judgment of $32,577,266 against Ronald Bradley Burdon and Marc John Ruttenberg, two of the three principals named in the Commission's 2017 notice, who had been noted in default and were deemed under Rule 19.02 to admit the claim's allegations of fact, per the Endorsement of Justice Conway, Aug. 16, 2024, paras. 3–5.